PayThink
MCX Can Avoid Harm from Its Crawl to Market

The Merchant Customer Exchange's mobile payment app is developing slower than expected, but the venture has advantages that should allow it to avoid harm from the delay.

MCX expects to launch an early-stage version of the CurrentC app in mid-2015, in a mid-sized market. That's well after initiatives from rivals such as Samsung and Apple, but MCX is still well-positioned for success if it makes the right moves and curries favor with banks.

Unlike rival Softcard, for example, MCX operates from more of a position of strength, most notably having many powerful merchants aboard before launch. As such, moving at its own speed ultimately may not hinder the potential success of the MCX mission.

The tests this summer will help MCX develop and tweak system functions and monitor user experience. Where that testing will take place will depend on factors such as retail support, infrastructure and consumer population.

After those mid-year tests, MCX has to give a clearer picture of where it stands and what it has in store for the payments and retail industries.

But MCX isn't entirely immune to pain from its slow pace. Consumers, merchants and banks are getting a clearer idea daily about what Apple Pay brings to the table and it most certainly is a payment method that loyal iPhone users will catch onto, if they haven't already. Plus, its entry into the payments landscape was powerful enough to spook some MCX members into dropping Near Field Communication payments.

That would be a good strategy if you were confident you had something better starting tomorrow. But alienating iPhone users interested in trying Apple Pay wouldn't come highly recommended for any retailer that lives by the credo of satisfying customers.

There is no denying that Apple Pay has some favorable factors in place in terms of ease of use, card-brand supported tokenization and the strongest technology brand possible  and a track record of constant improvements for its users. Plus, it is quite possible that Apple Pay will have been around for a year or more if MCX waits until well after its mid-year testing to unveil its system.

Still, MCX can overcome all of that because it sits in an enviable spot  if banks decide enmasse to bring their branded wallets into the game under anything resembling an MCX flagship. Late last year, industry analyst Richard Crone said that Apple Pay had motivated retailers and banks alike to cut deals through MCX for the acceptance of bank-branded mobile wallets and tender reciprocity in mobile payments at most major retailers.

And what if MCX could somehow sweeten the pot through its association with Paydiant and its new owner, PayPal, in offering to build those branded wallets for the banks as part of an MCX pact? That could make a long wait not seem so long after all.

Whether MCX launches a system next week, next month, next quarter or next year, it has to do so with some key factors firmly in place. One would be sticking to MCX CEO Dekkers Davidson's claim that his company is building an open network, one in which a consumer will be able to choose to pay through merchant proprietary apps, or through a CurrentC app that will cross all markets.